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enterprises listed on the SEHK. In 2005, equity funds raised by Mainland enterprises2 amounted to $198 billion, which was 66 per cent of the total equity funds raised through the SEHK during the year. About $151 billion was raised in new listings of Mainland enterprises in Hong Kong, accounting for 91 per cent of the total equity funds raised in IPOS on the SEHK. The market capitalisation of Mainland enterprises accounted for 39 per cent of the SEHK's total market capitalisation. In 2005, the total annual trading turnover of Mainland enterprises accounted for 46 per cent of the total annual turnover of the Hong Kong stock market. It is expected that Mainland issuers will continue to be major growth drivers of the stock market in the future.
The Hong Kong asset management industry is characterised by its strong international flavour, in terms of the presence of both global fund managers and authorised funds. According to the Fund Management Activities Survey 2004 conducted by the Securities and Futures Commission (SFC), which covered fund management activities of SFC licensed corporations that engage in asset management and fund advisory businesses and banks which engage in asset management and other private banking activities (collectively referred to as 'registered institutions'), the combined fund management business of licensed corporations and registered institutions amounted to $3,618 billion at end-2004, up 23 per cent from $2,947 billion in 2003. SFC licensed corporations accounted for 80 per cent or $2,896 billion of the combined fund management business, and the rest was reported by registered institutions.
Hong Kong operates one of the most active physical gold markets in the world. Spot gold can be traded through two closely related yet independent markets in the city the Chinese Gold and Silver Exchange Society and the Loco-London gold market. The society, established in 1910, provides trading of both tael bars and kilo bars3. Prices closely follow those in the other major gold markets in London, Zurich and New York.
Hong Kong continues to be one of the most open insurance centres in the world. Among the 175 authorised insurers at year-end, 86 were from 20 overseas countries or the Mainland. Twelve of the world's top 20 insurers are authorised to carry on insurance business in Hong Kong either directly or through a group company. There are 20 professional reinsurers, including most of the top reinsurers in the world. Gross premium income in 2004 was $122 billion.
Financial Services in Hong Kong
Banking Sector
Main Features
Hong Kong maintains a three-tier system of deposit-taking institutions licensed banks, restricted licence banks and deposit-taking companies. They are
2
Mainland enterprises include H share companies, red-chip companies and non-H share Mainland private enterprises.
Tael bars are of 99 per cent fineness and weighted in taels (one tael equals approximately 1.20337 troy ounces). Kilo bars are of 999.9 parts per thousand fineness and weighted in kilograms.